Section III. The Demand for Energy

The original article, prepared in 1960 and published in September of that year, took as its initial text the statement of the National Coal Board in April 1956 : “ Even in the longer term, the problem of overproduction for the coal industry can scarcely arise ”. The article was concerned to try to explain the divergence, from 1956 onwards, in the movement of gross domestic product on the one hand, and the demand for energy and particularly for coal on the other (chart 9). The two main explanations of the divergence were that the temperature in the 1956-59 period was higher than average, and that fuel efficiency improved much faster than before. As a by-product of these calculations, some conditional forecasts were made for total energy demand and coal demand in 1965 and 1970. These forecasts took three rates of growth of gross domestic product, in real terms—2, 3 and 4 per cent—and three rates of fuel-efficiency improvements—at 1950-59 rates, at 1957-59 rates, and a further slow improvement in fuel efficiency rates. The main conclusion about the future was that “ it would need a very slow rate of efficiency improvement, and a very rapid rate of increase in national output, for the demand for energy to reach 300 million tons (coal equivalent) by 1965; this is still the official estimate. It also does not seem likely that the demand for coal will rise over the next five years ”.